California Is Sovereign, Not Europe

A sovereign state ought to be able to decide what its currency is, and provide enough to employ its citizenry. California does, not so Europe.

In 2008, bankers told the government of the USA that ATMs and all banks would shut down immediately, if the government did not provide banks with the hundreds of billions of dollars to keep money in the banks. The government obeyed, and now the total aid to the American economy is said to be of the order of 13 trillion dollars, not far from the entire GDP of the USA. The European “welfare” states instead plunged into austerity, making sure that the value of the money of the rich would only augment, even if it meant European youth would have to immigrate to the USA to find work.

The USA talks one way, through its plutocrats, and the Main Stream Media they own. The reality is often the opposite of what they depict. Although the USA criticizes Europe for being too socialist, the truth is the opposite.

The California Republic Is So Sovereign, That It Decides Whatever Its Currency Is

The fact is Europe is not socialist enough to provide its banks with money for We The People. At least, We The Greek People: from lack of liquidity, Greek banks have been closed for two weeks and counting.

What kind of a sovereign is Europe?

Knowing what sovereign means help. It comes from the Old French soverain “highest, supreme, chief,” from the quite Vulgar Latin *super-anus ” (literally, superior inferior opening of the alimentary canal; as contemporary American urban linguo would have it, on face value, “sovereign” means super bad ass). An economist from India who has long contributed to this site, Partha, has made the following cogent observation:

Extinguishing Greek debt is equivalent to Europe being monetary sovereign which is what regarding all Europe as one country means. Greece would not be subject to austerity, wouldn’t have large debt payments and can grow. The created money will save banks and the investors in those banks. There will be no panic. At this point many banks can be nationalized. Which nation owns what is a question to be decided.

As it is Greece which needs energy will go with Russia and its own currency and will do well in a few tears. Energy was the only thing Greece was short of. This is a plus for Putin and a minus to EU.”

Well, I will not focus on Partha’s second point, where my perspective is different: Grexit, like Brexit, would mean a diminution of European sovereignty (thus a greater influence of other superpowers).

Although Britain can take care of itself, not so for Greece, thus Grexit is, de facto, an impossibility: kick Greece out, it will still be at the door (same problem with deluded England).

It’s easier to help Greece inside the EU, than outside. Moreover, Western Europe did not fight for Greece independence against the Ottomans to replace them by worse. Finally Russian methane is putting in danger Russia itself, the latest Russian numbers reveal. Solar PhotoVoltaics will make Greece energy independent: as soon as massive investments are done, existing technology allows this.

More saillant is Partha’s first point. European and World (IMF) authorities decided to led bankers escape punishment. Thus hundreds of billions of bad loans from banksters to plutocrats were reimbursed by the Greek state, itself borrowing from the so-called “institutions” (EC, ECB, IMF, etc.) AS IF this were a public utility.

In practice it meant reimbursing gangsters for their expenses. Thus, the behavior of authorities is tantamount to demonstrating that they have been captured by outlaw bankers.

Instead, a sovereign ought to have enough authority to decide what We The People are going to use as currency. Californians did not bat an eyelash, when they were told the State of California

***

Some say financial rectitude is everything. False:

Look at the USA. California is, by far the largest economy in the USA. The GDP of California in 2014, pulled by technology, was $2.3 trillion. The only states in the world with a higher GDP are Britain, France, Germany and Japan (in ascending order).

However, a few years back, California, which was bankrupt, was paying its employees with pieces of paper called IOUs. There was some grumbling, yet, so great is the awe of California in the minds of its 40 million denizens, that the Californian economy ploughed, right along. One of the reasons of California’s superiority is that it takes six hours, by jet plane to cross the continent, where some decisions centers are. Far away.

By a very long shot, the American state with the best finances is Alaska, giant in territory, tiny in population. What is its economy doing? It’s shrinking:

Everybody speaks of the Greek debt, but not how it originated. Everybody speaks of the Euro and Greece, but not how the German government agreed to make Greece twice richer than it really was, by deliberately converting Drachmas into Euros at twice the real rate. Surely that does not have to do with some places in Greece having the highest concentration of German luxury cars, in the world.

One is never better served, than by oneself. Papandreou, a SOCIALIST Prime Minister of Greece, was asked to help clean up after Goldman-Sachs had cooked the books of Greece to underplay the amount of deficit Greece had. As if European “authorities” did not know that Goldman-Sachs had cooked the books (I could have told them; cooking and plotting, this is what Gold Men do).

But the truth is dire: Goldman-Sachs (largest private contributor to Obama 2008 presidential campaign), had “captured”: European decision making. Many European decision makers were connected to Goldman-Sachs and its ilk. All of them probably hope to be in the good graces of Goldman-Sachs, and its ilk.

Papandreou is from one of Greece’s top three plutocratic families. So most of the aid to “Greece” was actually an aid to private bankers, many of them, not Greek. That was accompanied by such propaganda that most Europeans think that common Greeks are “splurging” (yes Greek plutocrats, ship owners, Greek church and military are splurging… with the help of northern European banks; hopefully the Trotskyist PM Tsipras will fix that next week).

Iceland did not go that route, the route of welfare for bankers: Iceland jailed its banksters. France, instead, judged and jailed a trader. Wall Street was delighted to find its own French trader to accuse, judge and condemn. So two traders, both French were accused of everything, and the City of London also found some foreign born trader to accuse.

So what happened to the Peoples’ Sovereignty? It’s over: High Finance has captured not just democracy, but the mind of We The People, and is the real sovereign. At least, more so in Europe, than in California. Even though California is the America, of America.

Something got to give. (That may be why Tsipras caused a crisis, knowing full well only a crisis would provide the needed energy.)

Next we will study a bit “Germans and Their Lies” (to steal Luther’s title about Jews). I am happy to report that dear Krugman is finally catching up on that subject.

Yes, the independence, the distance… The (one hundred plus cities of the) Bay Area is pretty much self-governing. Even under Bush, there were protests for the invasion of Iraq, and protesters were pretty violent in San Francisco, breaking stuff. Thousands were arrested. Then something remarkable happened: they were all released without charges. Bush was furious, but could do nothing. There is no national police, no prefect, not enough centralization…

Sladjana Josic: I detested Milosevic, Mladic, Karadzic too. I detested Seselj too. He was supporter of Milosevic regime and his men wanted to kill me and my family. I simply notice some similarities between Tsipras and Milosevic.I remember very well that greek socialists supported Milosevic regime. I am afraid that Tsipras and his company use lies as a tool for seducing people. Words and theories are different from life and harmonious society.I do not trust politicians. I too often detect lies and manipulation in their words. They care for their pockets only. They can easily sacrifice millions of people with no regret.

Referendum is Greece was a mistake. Thanks to Syriza and Golden Dawn it was possible to organize the referendum. One of the heroes of Golden Dawn is serbian war criminal called Arkan. It is a disaster that Golden Dawn is member of greek parliament.

Golden Dawn is a ‘criminal organization’ says Tsipras.
Tsipras also called Golden Dawn, third party in Greece, “fascist”. Referendum was not a mistake, but a splendid victory for democracy. Democracy is power of people. Living under banksters is not any better, long term, than under Milosevic. It can even lead to Hitler (who was supported early, crucially, by American and German bankers)

Why should we continue having the euro-zone? Lets break it, as it only increases hate between the different countries – as far as I see now.
Then all euro-zone countries are finally sovereign again; and can print as much as needed. More and more, I believe this is the only solution; especially reading your latest texts.

Good luck, with the middle class in many countries – you can all start to work for big companies – in small boxes, because that’s left when you are lucky and paying more and more for imports. Good luck!

That would be a meta-misinterpretation of my latest texts. Goldman-Sachs played the Eurozone. Instead of putting an Interpol Red Alert on some of the principals at Goldman-Sachs and their European agents, they all do as if nothing happened.

The Eurozone is, first, a matter of sovereignty. The problem is to know whether the badass of Europe is going to stay Washington/Goldman-Sachs or Europe itself. Right now, it’s Goldman-Sachs.

Second I often live very close to the “Italian” border (I say “Italian” because, before Mussolini, local people spoke French as they had, for many centuries). To have to change currencies four times when zooming between Nice and Munchen, is a major drawback. It also ruined European commerce (now there is a flourishing international used cars commerce for example).

The problem is not enough Europe, the solution is more Europe. Even USA agents in Europe (Draghi, Junckers, Mr. D, etc.)
understand this.

Otherwise it’s back to be ruled by Putin and Wall Street, a dynamic path to oblivion. Corruption is so high in the USA, the notion don’t even exist anymore. It’s called “fund raising”.

BTW, Chris, I hope you read Tom’s comment which was addressed to you, and was particularly cogent.
I remember the time when German leaders thought, loud and clear it was a good idea to make the Drachma twice its value in Euros… A gift to the Greeks, they claimed… Now Greek retirements are down 45% in 5 years… putting them where they should have been…

Yes, I have read Tom contribution, but again mainly about the past (whoever is right when and where, very difficult – as you probably also not agree to my link below?).

Anyway, I want to talk about the future; but just see blaming somebody else in the past. And, yes – also the Germans did this blame game much to much lately. Horrible; and it is not helping anybody. Thats why its best to break the euro-zone, I believe more and more.

Btw., I always thought that the exchange rates were not determined by the Germans – but by the EU counsel in this special case for Greece; at a time when Germany was pretty weak in the EU, but whatever…

The Eurozone has its own governance. The Euro value was determined by averaging the very long term value of the FRENCH FRANC (not the Deutschmark). The violation for the Drachma was completely known by the German central bank.

Breaking the Eurozone is war. As simple as that. As you claim you don’t like that, you should pay more attention. Also enough Germans and French know this intuitively, that it is not going to happen. More generally no way that England, London, and Greece sail to the South Pacific.

I do not think anybody will start a war if the euro-zone breaks apart:
First, I believe the EU will continue driving our european civilization.
Second, if the euro-zone breaks it will cost the Germans most; but I do not feel that Germany will start another war because of that (anyway, it has not even a military nowadays – which I like, of course).
Third, the NATO/US is still strong enough to take care that Europe is not doing anything crazy like killing ourselves again.

Please don’t nestle too many comments. That you think the USA ought to lead Europe is, no doubt, caused by you not knowing the USA. The USA is all about war. Even more than France. And its worthies view Germany, or Europe, as markets, inspirations for Disneyland, no more.

Of course, it was taken care that the German ‘Einlagensicherung’ (build up over dozens of years mainly by the german middle class) will not be raided by foreigners. Totally understandable, I think!
As soon as this was accepted by the EU partners; we moved on to build an european banking union.

You can believe your Europhobic slogan all you want, but the fact is, you did not make any cogent answer to either Tom, or me. And the thing about the banks, I have been writing for more than six years, and you felt that would come to me as a big surprise.

The official French position is that Greece does not get out of the Eurozone, end of the story. Deluded Germans can howl all they want.
Meanwhile, Greece can mimic California, and print IOUs.

Thanks for the link, Chris. I have mentioned this for six years, but I am happy to see a fresh write-up by francophobic hedge fund loving critters. Although French banks were heavily into Greece (for lots of historical reasons), the German total involvement in Greece (banks + industry, all these Porsches) was even higher.

And the fact remain, as I said all along that France and Germany, the unquestioned leaders of the Eurozone, a French idea, are culprit as all hell about what happened. Now DSK himself recognizes that the (deliberate) slowness of the Greek rescue allowed the (“private”) banks toi get off scott free.

Greece ILLUSTRATES ONE ASPECT of the Banking problem. It is gnawing at all of the West, not just Greece.

The EU DETESTS Tsipras. That might give you a clue about the latter’s merits. The EU also DETESTS referendums, because the plebs are two stupid to know what is good for them. That gives you ANOTHER clue.

Syriza was democratically elected; what this all has to do with Serbian nationalism escapes me.

Indeed, Chris, indeed. Tsipras, an ex (?) extreme leftist, is as anti-Golden Dawn as possible. Tsipras is the political leader in Greece who can put in place the anti-church, anti-military, anti-plutocragtic reforms needed. I don’t know what’s holding him back. Maybe he wanted the Greek population to feel first how dire the situation really was. Maybe also he is afraid that Golden Dawn will try to assassinate him…

The problem in Greece was the absence of a coherent, reasonable , convincing and productive reaction to the path taken. Syriza has various distinct factions, as any large party has, some of which are wacko. It was noted voted for these people, but in spite of them. In effect the reason the other parties remained in power for so long was exacty the l perceived lack of sane alternatives, while the other parties were campaigning on the slogan ‘vote for me, the others are worse’. Tsipras’s only demonstration of competence was that he was able (with the huge help of his opponents) to take a party with a sizeable wacko faction from 3% to 36% and government. He has also shown that he is pragmatic and not blind in many things, e.g. he has appointed known righ-wing people, not affiiliated with its coalition partner in key ministries, such as anti-corruption. Varufakis is also hardly a marxist, nor a Syriza member. If course growing from 3 to 36% means that it no longer represents the same people. That said, Tsipras has to balance things within its own parties, including the wacko section. At the very last resort, any PM in such a situation has given his party an ulitimatum ‘support me or I fail and our enemies win’, e.g. a ‘war’ speech. But that does not always work with wackos.
So bottom line is : If you want to take the hard -but correct- road, you will need both a clear sense of strategic direction (what needs to be done ) and the competence (how to do it down to the tacical execution) and he does not have that mechanism and all the right people yet. To give an example from Chess: If you sacrifice your queen for a pawn, and have seen a clear and unavaoidable way to a mate (or else to victory), then this is a brilliant move. If you play this without having worked out all the details in all cases, it is probably a dum and disastrous move. Time will tell.

Yes, Tsipras is pretty crafty. He has circumvented his own opposition with the referendum, and now that he has a mandate from the people, he can make them swallow the bitter pill, while getting complete support from the “indulgent” block led by France (which block has 54% of Eurozone GDP, higher than the one led by Germany). He is a Trotskyist agitator, he knows how to do this. This is going to work.

what is your problem to compare everything France vs. Germany…and then talking as you would prefer the EU…your wording are generating Memes which build walls between these two countries. I really do not understand?

“Memes”???? Why don’t you use the word “idea”? I am a European. I am pro-Europe. I generally talk about the French REPUBLIC. France, originally Francia, was a polity created after Roma collapsed in Gallia, founded by a GERMAN CONFEDERATION, that of the Salian FRANKS.

There is no “wall” I am building between “two countries”. I am pro-Greece, and all and any politician talking about attacking the Greek people, I attack. That was the German Finance minister forever, than to my amazement even Schultz (head of the EU Parliament) went nuts, and so did Sigmar Gabriel. Both SPD. Fortunately Merkel, this time understood she had, this had, gone too far.

You do not understand because you are blinded by a few aspects. I am actually extremely pro-German (just a detail: I drive German, not French or American cars).

but OK — I should just leave this site; as I want partnership … and not always trying to look for who is stronger, bigger, has more history,..etc. this competition will never lead to a common policy. Good Bye!

It seems to me that, for somebody who claims he does not like war, you are aggressive ad hominem. We philosophers are for stronger, bigger, better, deeper ideas. I am open to any critique. Even Nazis are allowed to whine. I just banned a pseudo-Islamist recently as he called some commenters “subhuman” (which, in context, was a violation of the law in some countries).

Europe cannot be stopped by those who can’t debate. Europe will only be made better by better thinking.

Marine le Pen applauded Tsipras in European Parliament. Pens support serbian politician Seselj. He was in prison in Hague because of war crimes, but was released recently. Now he is free and active in serbian political life.

Marine Le Pen did not like Tsipras at all six months ago. Now she has changed her mind, and explained why (I listen even to Marine Le Pen!) She now, rightly lauds Tsipras. In France, during the last presidential campaign the plutocratically controlled media attacked ferociously Le Pen on banks and the economy, saying she understood nothing. The only one who flew to her rescue was MELANCHON, the head of the Front de Gauche. Both Melanchon and Le Pen say what I have been saying for ten years, and Marx never said (but president Jackson of the USA said… Nearly 2 centuries ago)

This is not a valid argument. If Marine Le Pen says it’s day, I will not say it’s night just because she said so. Stalin was not a good guy just because Hitler did not like him. Thinsg are much more complicated.

Indeed! That’s a (meta) point I implicitly make all the time. I pick up good ideas even from those I have criticized as the worst of the worst. Wisdom debating some ideas is about those ideas, not how we feel about those who proffer them.

Supporting politicians like Seselj is dangerous and family le Pen does it. Seselj and his people are destructive and act directly against life. I am not familiar with french political life, but mostly extreme politicians from abroad are interested in serbian political life because serbian political life is extreme and out of balance.

I confess my ignorance: I know nothing about Seselj. If he was discharged by the ICC, he can’t be that abominable. To my knowledge, Le Pen supporting Tsipras in his struggle against banks , plutocrats and their servants has nothing to do with Serbia. If Serbia wants to get in the Union, it will have to shape up. And it’s not for tomorrow: Croatia got in the EU, but it was faster than Serbia at surrendering its war criminals. It also was willing to settle its different with a neighbor, Slovenia

Tsipras visited Serbia and serbian politican Vulin before some time. Vulin is another crazy politican. He was very happy when Tsipras and his party won greek elections in January. In his young age Vulin was a member of party that was run by wife of Slobodan Milosevic.

Dear Sladjana: Europe is a democracy, there should be a referendum every week. Tsipras is HELPING EUROPE ENORMOUSLY at this point. Europe ought NOT to be a banksterocracy as it is now. Frankly, Serbia is not in the Union, and will NOT be, for a long time to come, so its arcane politics is irrelevant to the Union.https://patriceayme.wordpress.com/2015/07/04/banksterocracy/

Chris: Old Germans want no one to have money but for themselves, so Europe is starved with money (OK, the French got that ball started). I know some, they travel worldwide, thanks to favorable GERMAN taxation…

Hopefully the Greeks are irrate and anxious enough to consent to strike they profiteering plutocracy, and agree to retire later. The French want Greece to reform heavily. (What Germany thinks is basically irrelevant, contrarily to what world public opinion believes, it’s France which commands, not Germany.) I will be waiting for your opinions and observations with great interest. Tsipras is supposed to present his reforms Monday, and Merkel, playing bad cop says no deal until she sees them (and that’s exactly what the French want, including Moscovici, the fiance-economy head commissioner of the EC, an ex-French finance minister).

Well, it went up enormously just shortly before… Small investors are getting wiped out, though, and that could be a serious political problem, so the government has stepped in. The Chinese economy is slowing down, in part because of on-shorization… China is also getting priced out since the Yuan is now more realistically valued…

Absolutely! That’s why California sailed through its very recent IOUs experience.
Moreover, except for the Roman Aurelius/Solidus, all money was mostly FIAT (including MOST of Roman system out of the pure gold of the Solidus).

It is difficult to critique critics who critique with deliberate bad faith (as many Republicans do) while ignoring that a lot of debt in Greece originated with corrupt banks which got the governments to give them money, and escape from the mess they created.

Also, as in the USA, a lot of rich people in Greece and very rich organizations, pay little or no tax (as in the USA, or even Germany).
One thing, for sure: when average people get punished with too much austerity, it breaks the economy.

For example, in US politics, while both political parties are problematic, I think the time for polity with the Republican party is over. I don’t see how any decent person can support a party that serves as a platform for Donald Trump over the party that is the platform for Bernie Sanders. The Republican party does not deserve polity, only outrage.

You mean politeness… Agreed. Donald Duck Trump is just a way to divide the vote of the wackos. He serves Jebb Bush that way. The more towars Trump, the less towards Rubio. My Machiavellian interpretation… If I could elect the president, I would elect Sanders, of course.